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New Bill Passes to Extend JOBS Act Provision

The US House of Representatives has passed H.R. 4139, the Fostering Innovation Act. The bipartisan legislation was introduced by Reps. Kyrsten Sinema (D-AZ) and Michael Fitzpatrick (R-PA).

The JOBS Act provides emerging growth companies (EGCs) with a five-year exemption from Section 404(b) of Sarbanes-Oxley (SOX), which requires a costly external attestation of a company’s internal financial controls. The Fostering Innovation Act would extend the JOBS Act’s SOX 404(b) exemption for an additional five years for former EGCs that maintain a public float below $700 million and average annual revenues below $50 million. The additional five years of cost-savings would allow growing companies to focus their capital on groundbreaking R&D rather than one-size-fits-all regulatory burdens.